Randgold Resources: Bristow says new mines hurt industry

Companies / 20 August 2014, 08:00am

GOLD producers opening new mines are hurting efforts to revive industry returns following the metal’s price slump last year, the biggest in more than three decades, according to Randgold Resources chief executive Mark Bristow. World output breached an annual 3 000 tons for the first time last year. That was while demand dropped 11 percent to 4 080 tons and gold prices tumbled 28 percent, the biggest slide since 1981. In the first half of this year, demand shrank a further 7.2 percent from the same period last year, according to World Gold Council data. “The downside is driven by the industry continuing to supply gold at a loss,” Bristow said. “We’re not disciplined as an industry, we’re not in good shape as a gold mining industry.” Investors that cut gold holdings as prices fell from highs have yet to plunge back in. The metal held in exchange-traded products totalled 1 728 tons on August 13, down from a record 2 632 tons in 2012. Gold prices have struggled to make headway after a first-quarter rebound. Goldcorp started mining at its Cerro Negro mine in Argentina last month, while its Eleonore project in Quebec will begin producing this year. Newmont Mining said last month it would build a mine in Suriname that would start output in 2016.